The Definitive Guide to Rat Race Math

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Do you dream of quitting your job some day and escaping the rat race?

You are not alone!

But do you know what it will take in savings or in side hustle income to make that dream a reality? That’s what this post is all about.

Nearly everyone can tell you how much money they make, but far fewer are able to tell you how much they spend. In fact, until I spent some time poring over a year’s worth of credit card and bank statements, I really had no idea either.

I mean, I’m sure you — like me — could come up with a ballpark guess if push came to shove, but I encourage you to try this exercise yourself to see:

Where your dollars are going

Where the opportunities for savings are

How much you need to quit your job — your “Freedom Number”

Why is this important?

Without a destination in mind, how will you know which way to drive? And how will you know when you get there?

(If math scares you, don’t worry, it’s nothing complicated. This math is a real life story problem that can set you free.)

Your Rat Race Freedom Number

Your Rat Race Freedom Number is the amount you need to be earning from your side hustle to cover your fixed monthly expenses. Once you can do that consistently, you’re free to quit your job.

This is similar to the premise of Robert Kiyosaki’s CASHFLOW board game, in which you escape the rat race when your non-job income meets or exceeds your monthly costs.

There are two ways to reach your Rat Race Freedom Number quicker:

Increase your non-job (side hustle) income.

Decrease your expenses.

What’s your number? How does it break down? We’ll explore what this looks like with some real life numbers below.

Your Retirement Freedom Number

Your Retirement Freedom Number is the amount you need to have invested/saved to cover your annual living expenses at a 4% withdrawal rate.

(4% is often considered a “safe” withdrawal rate to live off interest and dividends for the rest of your days.)

For instance, if you spend $40,000 a year, your Retirement Freedom Number is $1,000,000 in savings and investments.

Daunting? Maybe so.

Or maybe you’re closer than you thought. But a key component of both Freedom Numbers is knowing how much you spend.

How Much Do We Spend?

If you’ve never taken the time to figure out what you actually spend in an average month or year, I encourage you to add it up. We’d only ever ballparked the numbers before, but digging into the actual data was pretty fun for my inner spreadsheet-loving nerd.

Pretty fascinating too.

Rent / Mortgage

Monthly: $2199Annually: $26,388

This is BY FAR our biggest expense, as I imagine it is for most other people too. California is an awesome place to live, but man it’s not cheap.

I call it the “Sandal Tax” — the price we pay for wearing flip flops nearly all year long :)

The Sandal Tax also hits hard in the form of state income taxes, state business taxes (minimum $800/year no matter what your business earns), and even local business taxes — ridiculously based in our town on top-line revenue, instead of bottom-line net income. How is that even legal?!

Is it worth it? Only you can answer that question. For us, since we haven’t done any of those options yet, the answer is evidently no.

What are your other options to live cheaply?

If you own your place, you could pay your mortgage off early to kill that expense.

You’ll save thousands in interest over the now-much-shortened life of your loan, but with interest rates so low and tax deductions for mortgage interest, you’ll probably find a better return on investment for that cash somewhere else.

In extreme cases, if your job or income streams are location independent, you can ditch the high-rent completely and jump ship to a lower cost of living area. Maybe that’s a few hours away from where you are now, or maybe that’s on the other side of the world. While we were in Chiang Mai, Thailand this fall, we met a number of expats who told us their rent was $400-600/mo.

Even just 45 minutes east of us, rents are $1000/month lower. It’s a fun exercise; where would you live if you weren’t tied to your particular neighborhood, school district, workplace, or city?

Me? I don’t know. I love it here in the Bay Area, but I enjoyed my brief time up at Lake Tahoe. It’s beautiful, affordable, income and biz-tax-free in Nevada, and footsteps to some of the West Coast’s best skiing :). It doesn’t have all the amenities we enjoy here in the lowlands, but it’s close enough to day trip and is within an hour or so of a couple major airports.

I bring this up only because it’s a big world out there and we tend to have a pretty narrow view of our living options. If you reduce your living expense, options open up to you and your Rat Race Freedom Number all of a sudden becomes easier to achieve.

Cell Phones

Monthly: $126Annually: $1515

These figures are from 2013 for 2 iPhones on Verizon. We love our iPhones. Zero buyer’s remorse — they’re awesome.

But since our contract with Verizon was up last year, I began researching some alternatives, and came across Ting. (Get a free $25 credit on your account when you sign up using that referral link!)

Ting charges you based on the minutes, texts, and data you actually use — which means savings each month for all but the heaviest users. According to their website, 98% of cell phone users would save money on their network, and the average monthly bill is $21.

After finally overcoming the inertia the phone companies bank on, we finally made the switch.

By the end of 2014, I expect that $1515 to be at least cut in half. Ting’s service runs on Sprint’s network — which is indisputably crappier than Verizon’s — but I don’t think it’s $700 a year crappier.

Calls still connect, texts still send, and data still loads. Most of the time.

I’m pretty excited about our new phone plan for a lot of reasons, and will detail it all out in a post here soon.

TV / Internet

Monthly: $75Annually: $900

I’m not a Comcast hater, especially since I rely on their generally reliable service to run my business. But some of their business practices are a little annoying.

When we moved, it was a huge headache switching service addresses.

They pull shady shenanigans like hiking up your rate without notice. For example, when we signed up our rate for basic cable was $14.99 and Internet was $42.99. Since I hadn’t heard anything otherwise, I assumed they were the same since it wasn’t any sort of introductory special. But when I checked the bills for this post, I found the TV was up to $19.99 and the Internet up to $52.99.

The last time I looked into cutting the TV entirely, they told me the Internet-only rate was higher than the 2 combined. OK, we’ll keep the TV on then, weirdos.

Of course, there are dozens of posts on how to negotiate a reduced rate on your bill. If you succeed in scoring even a $10 monthly reduction in exchange for your half hour on the phone, you just chalked up a $240 hourly rate ($10 x 12 months / 0.5 hours)! Not bad.

If you don’t like confrontation, BillCutterz.com is a service you might like. They’ll call and negotiate on your behalf, for free with no risk on your end.

The catch? They pocket half the savings.

Utilities

Monthly: $100Annually: $1200

This includes water/sewer ($22.71/mo), garbage/recycling collection ($17.49/mo), and electricity/gas ($60.32/mo).

I’m sure there are some ways to reduce these expenses but it would be tough to make a major dent in any of them. These are all monopoly services so you can’t really shop around; they kind of just are what they are.

Do what you can to conserve water and electricity, but I wouldn’t go to extremes here. Sure, you can install solar panels and pump energy back into the grid, which is awesome — but as far as investments go, there’s probably a better return out there somewhere else.

Car Insurance

Monthly: $98Annually: $1174

The above figures are for 2 cars. And yes, in 2013 we totally “saved 15% or more” by switching to GEICO. The switch from Safeco will save around $300 annually.

Here’s how car insurance works and why you’ll almost always save money switching: Your car is worth less today than it was when you first bought insurance.

Your premium didn’t decrease, but your insurance company’s risk did. So it’s on you to update your policy or switch providers as needed every couple years to get a premium that’s more in line with your vehicle’s present value.

How else can you save on car insurance? Two ways:

Drive less. Lower annual mileage equates to less risk — if you drive less, that’s less opportunity for you to wreck.

Given my car’s not worth very much, I might still have more coverage than I should.

And on the extreme side, you could get rid of one or both of your cars. Of course, that would be part of a much bigger lifestyle change, but it’s part of the equation.

Renter’s Insurance

Monthly: $32Annually: $386

We pay $386 to insure all our “stuff,” around $30,000 worth.

It’s pretty cheap, but we’re probably overpaying. I don’t know if we really have $30,000 worth of stuff to replace if we got cleaned out by burglars or if there was a fire.

This one is interesting, because it increases year after year as the insurance company assumes you accumulated more stuff!

Probably not a huge savings opportunity, but might be worth looking into. Dramatic downsizing or minimalism (or just not covering your belongings) would be ways to knock this expense back.

Food

Monthly: $391Annually: $4691

This was our actual annual grocery expense for 2013, which works out to about $6.42 per person per day.

I have no idea if that’s high or low, though it’s more than we spent in 2010 and 2011 (didn’t run the numbers from 2012, restaurant spending not included … perhaps we ate out less last year).

We tend to eat pretty healthy (in my opinion), so that means lots of fresh veggies and not so much frozen Totino’s pizzas. It’s a fact of life in this country: eating healthier is more expensive than not — at least in the near-term.

Sure, there are ways to stretch your food budget. We could get more calories for our buck if we went heavier into the carb-dense but inexpensive staples like potatoes, pasta, and rice.

In fact, if you have a grocery bill-slashing strategy, I’d like to hear it. Maybe we can share it on The Side Hustle Show — because a dollar saved is a dollar earned. (Actually it’s even better, because you really have to earn $1.30 pre-taxes to buy a $1 worth of groceries — more on that below.)

Big Disclaimer: The figures above do not include any restaurant spending, which I consider fairly discretionary. Yes, you’re getting food but it’s also an “experience” — a night out, and a “service” — someone else cooking for you.

I found around $1600 in trackable restaurant expenditures (on credit cards), or around $133 a month. We eat out probably once or twice a week on average.

Also lost in the food spending is any restaurant visit paid for in cash. I normally like to use the credit card whenever we can to earn the points, but I’m sure there was also a few hundred in cash spending on food as well.

I’m not going to be the guy to say stop dining out. (Since I don’t cook that often, it would be really bad for me to say it!) Of course it’s more expensive, but it’s generally good times with good friends. At the end of the day I think we’d all rather have that than a few more dollars in the bank.

Now if you and your buddies have a standing Thursday night reservation at Morton’s… maybe there’s an opportunity to cut back a little :)

Gas

Monthly: $167Annually: $2007

I was surprised my number was so high, given I have no commute! I actually spent twice as much on gas as Bryn, and she drives to work each day.

Here’s what I think happened. In town, I almost always drive, and for long road trips, we always take my car.

In 2013, there was several trips to the mountains, a drive to Southern California, and a trip back home to Seattle. Even without a commute, I manage to rack up around 12,000 miles a year.

The trick to saving money on gas (aside from getting a more fuel-efficient car) is to make sure the majority of your miles are business-related — that way you can write it off.

Even though I spent more than $1200 on gas last year, my company reimbursed me more than $1400 for the mileage I put on my personal vehicle.

Disclaimer: I’m not a tax professional, nor do I play one on the Internet.

Of course the other option is to drive less. I could probably bike more, which comes with the added benefit of being great exercise. The downside of biking? It takes longer, and your time is valuable.

Other Expenses

Car Maintenance: $125

Thankfully no crazy expensive unexpected repairs last year — knock on wood!

Gym Memberships: $684

Gotta stay fit, right? My gym is pretty bare bones and is $17 a month. Bryn’s is much swankier and is $40/mo.

If you have a gym membership, especially a fancy one, start to keep track of how often you actually go. Either you’ll go more often because you’re consciously tracking it, which is good, or you might find you’re actually paying $20 or $30 a visit, which is not so good.I go once or twice a week, which means it’s around $3 or $4 a visit. Not too bad. I’d drop it, but it gives me an excuse to get out of the house, and it’s right by the grocery store so I always combine trips.

There are plenty of home-based bodyweight exercises that are just as effective.

Pet Expenses: $441

Our little guy is thankfully pretty low maintenance. But he’s got to eat, see the vet, go to boarding, and get his meds.

What’s Missing?

If you quit your job to pursue your side hustle, what will you do for medical coverage?

I was shocked to find that self-employed insurance rates had gone up literally 4-5x since I last bought my own insurance in 2008. (Thankfully I’m covered through Bryn’s work now.)

For the 2 of us to buy our own coverage, we’re looking at a minimum of $468 per month. And that’s for absolutely shitty coverage — a $4500 deductible and a 40% copay.

That means an annual cost of $5600 (that’s not locked in either) for the privilege of paying another $4500 before any actual coverage kicked in. It would almost never actually provide any benefit, unless something truly catastrophic were to happen.

In case you’re wondering, the Obamacare penalty for not buying your own insurance is a maximum of $285 in 2014. Think that’s a steep enough penalty to get healthy people to buy into this ridiculously expensive private system?

Child Care

No offspring here.

Our friends who’ve taken the leap inform us a new side hustle might be required just to pay for day care. Think in the range of $1300-1700 per month!

Car Payments

I’ve been fortunate enough to never have a car payment. I should couple that by saying I’ve never owned a new car.

Here’s my $0.02: If you’re paying each month for your car, you probably bought too much car — even if you’re at 0% interest.

Lose the car payment!

Credit Card Debt

The average American household has over $7000 in credit card debt (source)! We have $0.

(Woohoo — high five for being below average!)

Think of it this way: if you carry credit card debt, in some meaningful way, a newborn with $0 to their name is wealthier than you. You’re in the red.

Unless that debt is fueling some sort of bootstrapped venture and you hope to see a positive return on it, you’re going backwards.

How? By paying my balance each month, I actually earn a negative interest rate — meaning they pay me — when you factor in the rewards points and miles. It’s awesome!

But credit cards are like knives. They’re useful tools, but you can hurt yourself if you don’t know how to use them.

Killing the credit card debt has to be Step 1 toward reaching you Freedom Number.

So What’s Your Number?

What do you get when you total up all your “fixed” living expenses?

For us, we’re at $3256 per month, or just over $39,000 annually. Of course, if I were to declare your Rat Race Freedom Number to simply equal your monthly expenses, I’d be neglecting at least one crucial factor: taxes.

You tax rate may vary, but I like to err on the side of caution and divide your fixed expenses by a tax rate estimator. Here’s how it works:

Since that $39,000 is your actual out-of-pocket cash expense, you’re actually going to need to earn more than that to have $39,000 leftover after taxes.

Chipping Away with Passive and Side Hustle Income

Now if you’re like the me, the prospect of building side income streams totaling $4650 per month on a recurring basis is pretty intimidating, especially if you’re starting at zero.

One way to “gamify” the Rat Race Freedom Number is to break it down in terms of the line items on your monthly expenses. Everyone wants a side hustle to cover their rent, but why not start with a utility bill or cell phone bill?

If you can chip away at your monthly expenses, starting with the smallest and working your way up, you’ll feel a greater sense of accomplishment, while still making meaningful progress toward your number.

Accounting for Changing Scenarios

One consideration to keep in mind is how your Freedom Number might change if you were to make some lifestyle changes.

For instance, if we decide to procreate, we’d need to adjust our number up substantially to account for child care, food/clothing/diapers, and college savings.

(Hopefully in another 18 years college will be obsolete!)

Or, if Bryn were to “retire” from work, we’d be required to buy our own health insurance; another additional expense. On the flip side, that retirement would also create a new opportunity to move to a lower cost of living area, so maybe the additions and subtractions balance each other out — or weigh more heavily in one direction.

Either way, these are the kinds of calculations to consider when evaluating your Rat Race Freedom Number.

The Big Picture: Your Retirement Freedom Number

Ahh, living off interest. That’s the dream, right?

You work hard, save your money, invest wisely, and then — one day — you can retire. But would you recognize that day when it came?

How much you need to retire is your Retirement Freedom Number. It depends on how much you plan to spend, and the easy way to calculate it is to multiply your annual spending by 25.

If you’re like us, spending around $40,000 a year, that would mean a Retirement Freedom Number of $1 million in savings and investment accounts.

$40,000 x 25 = $1,000,000

The reason for that is you can probably find some reasonably safe investments that pay out 4% in interest or dividends, without ever having to touch the principal value. You’re set!

(This is how university endowments work — huge sums of money earning interest income in perpetuity.)

Along these same lines, some financial experts suggest a 4% withdrawal rate on retirement savings could last you the rest of your life.

Of course, amassing the $1 million net worth isn’t exactly a walk in the park, nor will it happen overnight.

But what if you cut your living expenses. Could you live on $30k a year? $20k a year? Then you’re only looking at $750,000 and $500,000 in net worth respectively.

Maybe a little more attainable?

And want to know the real beauty of the Retirement Freedom Number? It assumes you’ll never make another dime.

But imagine what could you accomplish if you had another 40-60 hours a week of free time all of a sudden. My guess is you could find some meaningful and profitable way to spend your days.

Once you’ve earned Retirement Freedom, there’s no pressure to earn money. Instead you can focus on being of value — and when you do that, money has a strange way of following.

What would you do if money were no object? What would you do if you didn’t have to go to work anymore?

Your Turn

Here’s your homework:

1. Add up your fixed monthly and annual expenses. Any surprises in there? Any opportunities to reduce your costs?

2. Find your Rat Race Freedom Number and Retirement Freedom Number.

3. Share the results in the comments below, along with any opportunities you found to reduce your expenses and how your side hustle goals factor into the outlook.

I love this stuff! Feel free to hit me up with any questions either by email (nick at sidehustle nation [dot]com) or in the comments below.

35 thoughts on “The Definitive Guide to Rat Race Math”

This is a really good practical post for EVERYONE. Sometimes we get caught up in what we make, but it’s what we spend that makes a bigger difference. If you can learn to live lean, you don’t put as much pressure on yourself to make a ton of money. You can still live a very fun lifestyle without a bunch of money. I think it makes you more appreciative and generous too. Another question is how much debt do you have?

Great post, Nick! I’ve never thought about how to calculate the Retirement Number (no doubt my better half has it tattooed somewhere). It’s funny, we talk a lot about wanting to retire early, but I had no idea how to determine when you’re ready to make the leap. And $1M doesn’t actually seem THAT bad (says the girl without an income).

Also, the awesome thing about side hustling and having kids–you get to dictate your own hours and can much more reasonably juggle your lives so that you can take care of them yourselves. Childcare expense = $0! Of course, this assumes you can tolerate your kids 24/7, which is a work in progress over here. :)

The other cool thing about the early retirement thing I forgot to mention is that it assumes you make $0 for the rest of your days. With an extra 50-hours a week of work + commuting time, I imagine most people could come up with some sort of income-generating hustle! And bonus points if it’s based on something they enjoy doing :)

Nick, this is indeed an important topic. I ran my numbers, they end up similar to yours, even though your housing is 2x that of mine in AL. Looks like I have some cutting to do!

$1M can seem very far off, but considering all sources, 401k, IRA, you might be 1/4 the way there already. And since we are side hustlers here, we can be saving both job income and side income to accelerate to the finish line.

Great post Nick! I haven’t run my #’s yet, but the biggest area for me to cut is food. You asked for feedback on your $6.42/person/day. That seems low and I would love to get it to even $10/person/day ($600/mo) would be a significant improvement. Thanks for the tips & sharing.

Thanks Roger! We’re probably closer to $10 a day (or higher) including restaurants. Plus there was the 5 weeks we spent in Asia last year when we didn’t have any “grocery” bills but spent a lot of cash eating out, so that figure is probably artificially low.

All these calculations aside, I think, after living the last 10 years abroad, the number #1 tip I would give folks is this: learn to live with less.

I know, it’s not for everyone. I owned a large home, drove a big car, had a big portfolio, etc, etc, in the Excited States for many years.

However, after a few financial reversals: expensive divorce, bad investments, prolonged unemployment and underemployment, I decided to hit the road and move overseas.

Again, I know this isn’t everyone’s cup of tea. But, after drastic downsizing, I came to see that many of the big so-called luxuries I thought I needed, were really burdens more than blessings.

I lived for a year in Chiang Mai (paid rent of about $190) in a very nice studio apartment and was never happier. Life abroad exposes you to many more people, cultures, and ideas. Terrific.

And as for employment, thanks to Al Gore’s internet, I can make money off Western employers. I write and help people and companies with their internet marketing and enjoy Western pay while living in 2nd and 3rd world countries on their reduced cost economies.

I really learned a lot reading it. I plan to learn more ways to make money on the side and cut down on my expenses, maybe that can cut down the time I need to save for my retirement fund my half, hopefully. :)

Our retirement budget is $2,400/mo including all normal expenses, insurances, medical plans, gas and groceries and a little extra.

We will be getting $2,668/mo in social security (I’m 64), and $649 from a small pension. I’ve worked it out with Turbotax TaxCaster, and to stay Federal Income tax free, we can pull $1,217/mo out of our retirement IRA accounts. So with zero taxes, we will have $4,534/mo income, and $2,400/mo expenses. This means we will have a savings rate of $2,134/mo if I never earn another dime. That’s about $26,000/year for travel, repairs and expenses etc. Oh and we have $50,000 already set aside, not included in our IRA’s for our Travel Fund.

Just pointing out that we will have an income of $54,408 with zero taxes (p.s. I have a few years of $3,000 tax loss carry forward to work thru).. You’re not at an age yet to have looked at this, but there is a workbook and formula available at the IRS, and basically if the sum of 1/2 of your social security and your other income is less than $32,000 for a married couple, then your taxable social security is zero, which greatly reduces your adjusted gross income (only the other sources count). So I work TaxCaster to see what the maximum IRA withdrawal is I can make with zero federal taxes. This is still less than a 4 percent safe withdrawal rate..

Interesting post. We followed the same strategy. I built a side hustle for 6 years and quit my day job 11 months ago. I was not in a hurry to quit but loved the fact that I could pull anchor at any time. It gave me peace of mind and reduced my stress considerably. During this time, we built up our nest egg.

My husband and I now bring in only 1/2 our previous combined income, but we are saving just as much every month as we used to. Woohoo! That’s what focusing on what goes out (even more so than what comes in) delivers.

We are less stressed, debt-free and well on our way to that 25X number.

We all need to keep in mind that $10/mo equals $120/year. That is a significant chunk of change when you consider that we are all spending $100+ per month or more that we don’t need to spend.

It’s also important for people to realize that you cannot save your way into wealth. Sure, saving money is important, but you eventually need to make more money.

For most of us, making more money at our current job isn’t an option. Yes, you get annual raises and bonuses if you’re good. But if you really want to make it, you need to start your own business. You need to learn how to hustle. You need to learn how to make your own money.

Now, starting your own business is not as complicated as people think it is. Can you shovel snow? Side business. Can you walk dogs? Side business. Can you build websites? Side business.

If a business exists, then it is possible to create another business just like it. How many pizza places have you seen in your lifetime? How many barber shops? How many bars? If an idea has been done before, that means that the idea works. In the end, that is what matters.

By the way, thanks for sharing a link to my post about how to negotiate with Comcast, Nick. I appreciate it.

Here’s and add for the “insurance” section, since I happen to be a subject expert.
1) Bundling – you save money on all our coverages when you combine them. Your car(s) and house (or rent) insurance should be with the same company. We’ve got life, auto and renters with the same company, and with the discounts we get, our renter’s insurance is nearly free. Potential savings 50%+
2) Shopping – all companies will raise your premiums over time, even the cute CGI lizards. Every three years you should visit an independent insurance agent AND a captive agent (Farmers, Allstate, State Farm) to shop your coverage. Keeping in mind #1 above, most agents will clamor for your business. Potentiall savings 25%+
3) Don’t be cheap – coverage and claims handling. The real price of insurance is felt only AFTER something bad happens. I’m in the disaster industry and I’ve seen everything. That “15% or more” sounds nice until you discover you’re not properly covered once you’ve lost EVERYTHING in a fire or accident.

Great post, and an important lesson for everyone. Calculating my ‘Freedom Number’ was one of the first things I did, maybe it’s the accountant in me..

I have had a file saved on my work desktop for over a year called ‘Escape Plan’ with my magic number on. It’s always changing, and I have shrunk it somewhat. But assuming my current situation stays the same and saving you breakdown – my current goal is £1,200 or $1,800 a month (assuming I can shed my car hustling from home).

What a great post here that makes a lot of sense. I have kind of been doing this as well for a few years now, things such as clothes for example I don’t buy anymore.
Fashion doesn’t mean anything to me and sometimes I will get some as a gift, or only buy them at a very low price.
I will have to do these exercises soon as well to get a real idea of what I’m spending on, thanks for the info.
Hustle!

I totally enjoyed this post and it turns out our numbers are very similar although I live in Puerto Vallarta, Mexico. Found some ways to cut expenses and I am going all in on my hustler thing and work. Time to Hustle & Flow. #urbanstore420 #sidehustlenation

Puerto Vallarta is a tourist town, so it is significantly more expensive to live there than further inland. Prices are raised on everything in order to get more money out of us gringos. I don’t live there, but used to visit Mexico often when I was a teenager.

If you want to make the retirement number happen a little faster, you can shop for something called an Immediate Annuity that will pay out at a guaranteed rate for the rest of your and your partner’s lives. The upside is that the effective rate depends on your age and will be more than 4%. The downside is if the economy does well, your investment income has no chance to participate.

Like you say, with the right amount of post-retirement side hustles, lifestyle changes, and distaste for for your day job, it makes sense to look at all of your options.

Great post Nick! I’m wondering about savings? This always trips me up when I am figuring out my freedom number. I have a couple of kids so I always try to contribute to a 529 and my wife and I try to max out our Roth IRA’s. That bumps our number up $16k alone. Do you consider these things?

That’s a good question Chris. We’re in the same boat and do “spend” a lot on savings in that way. But if the goal is to get out of the day job, those are probably non-essential near-term expenses. It’s a tough call.

Thank you Nick for this very informative article. I feel like I’m in trouble. I love your phrase:
“There are 2 ways to be rich: make more, or desire less:)” and that’s where I have a few issues that need to be addressed immediately. I’m glad I came across you online because I’ve got a lot of work to do especially on my side hustles!

A joyful day at our house was when I bought a 5 unit cordless phone set and transferred our land line to Magic Jack. That added a phone in the garage w/o adding a jack and eliminated the cord tangles. We already had reliable internet service with our cable service and Magic Jack was so EASY to install (just plug it into the modem.) Our home phone bill dropped from $120/mo to less than $40/YEAR with no loss of reliability. (And we no longer had our local phone company screwing up our billing every third month.) Do take the time to set up for 911 service when you change over.